Corporate Center

Aboitiz Group Risk Appetite





Over the past few years, team leaders and team members across the Group have developed and implemented programs and initiatives for our organization to achieve a level 4 in Risk Maturity. This involves building a risk culture that encourages participation and engagement at all levels of the organization. It is about using risk management information for decision making in our day-to-day work. It entails understanding our risk exposures so that we can turn these risks into opportunities. It is by no means avoiding risk at all costs. It is about being more aware of the exposures we take on, managing this risk and ensuring that the appropriate risk mitigation is in place so that we can truly achieve enterprise resiliency.
In 2012, we instituted a Group Risk Appetite Policy under the Aboitiz Enterprise Risk Management program. Risk Appetite is defined as the amount of risk we are willing to accept in pursuit of value. Our current Group risk appetite policy, which is used as the basis for our risk reviews and retention strategies, states that we cannot take risks that can impact 30% or more of the Group’s Net Income after Tax (NIAT) or P6 Billion whichever is lower. This also implies that we can accept risks below 30% of the Group’s earnings (or P6 Billion whichever is lower).

At a business unit (BU) level – risk appetite would be equivalent to 30% of the BU NIAT. Our risk management process involves risk  identification, assessment, development and execution of appropriate risk treatment strategies to effectively reduce or eliminate the likelihood and/or impact of the risks to our Group’s earnings and the achievement of our long-term goals.

As we expand and grow our businesses both in the Philippines and abroad, the magnitude of our exposure to different risks will inevitably increase. We, therefore, feel that we need to update our existing Risk Appetite statement to ensure that our policies support our risk management strategies, the governance and management of the risk retained, and our risk decision processes.

After a careful review of the leading practices relevant to our businesses, we have expanded our risk appetite assertions to include other parameters. These are as follows:


We, in the Aboitiz Group, are committed to risk management excellence. Let the above expanded Risk Appetite statements guide us in our day-to-day decision making. We have to be prepared at all times for the unwelcome visits by Murphy. Enterprise resiliency is essential in order for us to achieve our mission to create long-term value for all our stakeholders.

Thank you for your continued support and cooperation.

Erramon I. Aboitiz Aboitiz Group President and Chief Executive Officer
Erramon I. Aboitiz
Aboitiz Group President and Chief Executive Officer